EU Pushing BIS for Export Control Clarity, Preparing for ‘Detailed’ Talks, Senior Official Says

“The U.S. is not telling us,” said Peter Sandler, a European Commission official who oversees enforcement, market access and technology. Sandler said the commission has asked for clarification multiple times, including with “my counterpart in the Bureau of Industry and Security who runs the whole control system,” but the U.S. is “not giving more away as to the reasons why they have selected some and not others.”

The BIS rule, published by the Biden administration, groups the world into roughly three categories of countries, each of which will face different export license requirements for certain advanced chips (see 2501130026 and 2502110074). Some EU members are in Tier 1, the group of nations that will face the fewest export restrictions, while others are in the more restrictive Tier 2.

Sandler, speaking during a hearing of the EU Parliament’s Committee on International Trade, said EU officials also spoke with the State Department about the controls last week, but the agency “didn't clarify” how EU members in Tier 2 could move to Tier 1. He said the lack of explanation from U.S. government career officials suggests the decision was “a political choice -- so taken at a very high level within the administration,” and the EU is hoping to gather more information as Commerce Department and BIS political appointees come on board.

He noted that Maros Sefcovic, the EU’s trade and economic security chief, was meeting with Commerce officials in Washington this week, and the commission is expecting to hold more talks with BIS soon.

“We're preparing for detailed engagement at a technical level with the U.S. -- and in parallel, the political context -- as soon as appointments are confirmed,” Sandler said.

He also noted that the AI diffusion rule was published in January with a delayed compliance date of May 15, and the Trump administration may decide to make tweaks. “So at this stage, we are precisely looking at how we exert pressure in a diplomatic way to try to influence or shape the possible outcome from the U.S. side,” Sandler said.

Sandler also stressed that the EU isn’t yet prepared to retaliate against the U.S. controls, including through its anti-coercion instrument, which allows the bloc to impose countermeasures against countries in response to measures that it deems qualify as economic coercion (see 2303280024). “We're not at that stage,” he said, adding that the EU is still trying to “vigorously pursue a diplomatic channel.”

That has included making it clear to U.S. officials -- through private talks -- that the EU opposes the rules, he said.

“It is a major concern to us that the measures divide EU member states into first- and second-class citizens to whom different restrictions will apply regarding the supply of the most advanced AI chips,” Sandler said. “We are working very closely at this stage with the member states to see how, and to coordinate the responses, in terms of trying to push this back.”

He called the rules “counterproductive,” adding that the restrictions will “force us to look elsewhere” and could cause U.S. companies to lose out on sales. It also will hurt EU companies that will need to “potentially rely on less secure sources of technology” from nations other than the U.S.

Several European Parliament members said they were frustrated that the European Commission hasn’t received an explanation from the U.S. about the BIS rule’s tier structure.

“I can understand that we have to play a bit cool at the moment,” said Jorgen Warborn of Sweden. “But the fact is that now one month has passed, and there are three more months until the grace period ends, and we have to find a solution.”

Sandler said the European Commission has built “very regular contacts with our counterparts” at BIS through the U.S.-EU Trade and Technology Council, and they have spoken this week about “various measures that are being developed on the U.S. side, including the AI diffusion rules.” BIS officials are “ready to engage,” he said, but they are also waiting “on the political view being taken on the AI diffusion rules by the incoming administration.”

President Donald Trump ordered Commerce last month to scrutinize its export control processes, which has resulted in an ongoing policy review within BIS, including over its licensing procedures (see 2502130068). James Rockas, the acting BIS undersecretary, has been tasked with spearheading part of that review, which has led to some licensing delays, Export Compliance Daily reported 2502190018).

“They have an acting undersecretary at the moment. They're starting conversations with that person,” Sandler said. “So these rules are coming out at a moment where it's quite difficult for us to find the right person to get our messages across to.”

Without understanding more clearly how the U.S. selected which countries to group in Tier 1 and Tier 2, the EU is hamstrung, Sandler said.

“Without that information, it's very difficult to know how we can ensure that there is a shared view of the security risks and how to mitigate them,” he said. “But we are very strongly committed to working on this, trying to understand the basis on which the decisions have been taken, and to arguing why they need to be adapted in the final shape of the rule.”